Based on a new poll of municipal councils, English councils are preparing to offload social clubs, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to balance the books.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that six out of ten of councils are intending to sell assets to meet the rising costs of adult and children’s social care.
Councils have in the past come under fire for disposing of playing fields and open spaces to support their finances, but they contend they must continue to raise vital cash from asset sales or face insolvency.
The group said that a high proportion of councils seeking to raise money from a quick sale of assets represented “a clear change from 2024, when the largest share (60%) of municipal officials said they would prioritise restructuring services and utilising financial reserves to manage increasing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in Kent said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to raise 20 million pounds over the next half-decade.
- A local golf course and business parks held in two English counties, which all generate rent for the authority, will additionally be sold under the plan.
Council Tax Rises and Broader Fiscal Pressures
The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise local levies next spring to cover the rising cost of core provisions, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council explained it will proceed with property disposals after steep rises in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are taking innovative approaches but some of these take time to achieve both better provisions and financial savings,” said a council leader.
He continued: “We face population challenges which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
Countrywide Trends and Projections
Research of county councils this week further found council budgets being strained by the increasing figures of young people and older individuals requiring Send support.
A network of councils said that council deficits will reach 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.
Ministers have delayed scheduled changes to the Send system until the coming year after a white paper setting out those reforms was recently delayed.
Disadvantage and Financial Gaps
Based on the most recent indices of deprivation (IMD) covering English councils, several key cities members were among the most deprived in the country.
- “Participating urban centers like several major towns place in the top 30 across the country under the latest deprivation indices,” noted the report.
“While only a single urban area is among the ten most deprived for deprived neighbourhoods countrywide, cities are far more likely to be in the worst-off 20% of England. The data underscores the extent of challenges facing local leaders across key cities in the coming year,” the report concluded.
“Local government leaders have been explicit about the necessity for a equitable and lasting funding system that reflects and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Lacking this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the detriment of their residents.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the survey found.
